$1000000000.00 their asset their balance sheet expanded by that so let's look at that fed balance sheet moved up to $4.00 trillion highest level in 14 months over for him to the $6000000000.00 over the last 4 months quote in no says is this q.e. this is nothing like it jerome powell had said october 8th 2019 you can see that it's a v. shaped recovery in the fed's balance sheet since you know the nasdaq as i said was a 40 percent nearly 40 percent so 60 percent of the gain and the nasdaq happened from that point let's revisit my ongoing theory which is that you've got really low interest rates now for 10 years near 0 or in some cases negative and there are a few private equity folks that are taking all the stock off the board you know in remember a monopoly. the winner has all the real estate and everyone else becomes

a right so this is the same thing nasdaq is just a proxy for monopoly and the players that are winning this are both the bank and park avenue and park place the 2 most valuable spots on the board game of monopoly so. that's this is exactly what i've been saying for a few years now if you keep printing trillions and trillions of dollars and you don't allow it to go into wages you cut them off you you you you you vilify the working person and you just give it to private equity speculators you're going to end up with this enormous bifurcation in the economy of extraordinarily wealthy plutocrats and kleptocrats and surf the surf class the losers the deplorable i might add that is also a hedge funds hedge funds play a big part in the repo market that's where they go for funding and then 10 x. leverage up into the markets so that's important because of course as i mentioned here's the fed's balance sheet it had been declining it was down 8 percent on. year

at one point for the 1st 3 quarters of 2019 it ended the year up 2 percent the fed's balance sheet so those a huge turnaround that's the v. shaped recovery so i'll match that to this tweet here feynman market cap has hit fresh all time high 5.249 trillion which is almost equal to the combined g.d.p. of france and u.k. as big tech keeps rattling fame in our facebook apple netflix and google so if you look at those chart that's the surge in the fed's balance sheet they're printing money and that's the surge in the fang and shares at their so it's they're going lockstep so to put this in perspective though on a global basis there was never any diminishment of money printing so the fed was down maybe 678 percent of one point over year over year the trend was extraordinarily expanse of maybe a couple of quarters down but globally it's never gone down any at any months the

it's never gone down so the global printing by all the globe's major central banks has gone on on this hyperbolic increase which has led to a 38 year bond market rally which is unprecedented and unreasonable and is dangerous for any economy to have that kind of a misallocation and the trickles down to the bank stocks in the fang stocks are momentum stocks the you know this dissuasion overvalued group 5 years ago 4 years ago 3 years ago 2 years ago one year ago one month ago last week it will be an overvalued group in 6 months i can't get more overvalued because the ratio of at nasdaq to s. and p. 500 was almost twice as high in 2000 during the dot com bubble so those valuations can continue to rise so don't fight the fed and don't fight warren buffett i might add because warren buffett my. be even bigger than the fed remember he poured into

apple early in 2019 well this is a tweet about the biggest largest company in the world well i guess i am co saudi aramco is now the biggest but apple is the biggest corporation in america in case you missed that apple is up over 80 percent and $21000.00 is best year in a decade largest traded company added $530000000000.00 in market value this year more than the market cap of all 5 comparables in s. and p. $500.00 and twice the market value of intel so that's the price rise in apple and $21000.00 and of course right now the big loser of that well as carl icahn you know carl icahn was sold to warren buffett around $14150.00 a share sound close to $300.00 so it's a double since carl icahn and he sold it because he thought it was overvalued the market was overvalued he told everyone to get out of the market he stopped managing

private money he only manages like this huge family office fun so he's been dead wrong i mean there's a multi-billionaire there's generally been right going back to the eighty's he was part of the the mike milken crowd of the 1980 s. who were given extraordinarily huge tax breaks and free money as you had the s. and l. crisis and then the drexel burnham crisis but he's been dead wrong you know with apple computer it started off at a very low valuation remember back in the late ninety's when it was at less than $10.00 a share adjusted for splits michael dell of dell computer recommended that steve jobs quit the computer business in that he was no good at it and nobody wanted to buy the stock under $20.00 now everybody wants to buy the stock at $1.00 trillion dollars valuation you know it's it's contrarianism versus the blindingly obvious you know warren buffett pursues the blindingly obvious every a lot of people are like hedge funds are contrary and tend to underperform even. a

simple vanguard type s. and p. tracking fund well we're going to look at a chart of apple going back 39 years this is it right here is the dot com bubble little tiny blip down there this is the 2008 crash. and as you see it's gone. since then the fed money printing has done well for them i guess also the powerful state department introducing intellectual property laws and things like that around the world has done well but it's hard to see on this chart but it's definitely going parabolic this year based on that long term 39 year chart right you know going back to the late ninety's and early 2000 apple was a really hated company because it had lost a lot of people a lot of money after the heyday gone public and then steve jobs left the company if you recall in the stock was underperformer and people really hated it so as a result you know apple just now on

a price earnings multiple is just now becoming closer to the market average on a p.c. ratio it's not overextended like back in the dot com days these tech companies are nasdaq or netflix for example or the other frank stocks are trading at 70880120 times earnings or 200 times earnings astronomical price earnings multiple the case of apple they're just trading at a market multiple i believe last i checked it's somewhere around 20 up from you know 2 years ago it was 10 or 12 which is extraordinary so you mentioned carl icahn and you mentioned that he had said it was overvalued and of course a lot of these things are overvalued based on historical metrics but history never had negative interest rates they never had such activist central banks i mean central banks are pretty new and on a global situation the united states got ours in 1913 and of course bank of england has been around for a while but we were on everybody was on a gold standard back then so we haven't had that sort of interim interventionist

central bank policy as we see now we're going to get into another chart about that another statement about central banks but of course warren buffett also he does have a matter of the one metric he looks at to determine whether or not markets are in a bubble. as he said if market cap equals 100 percent of g.d.p. that's what he said he decides to sell and that has happened in the last month of $21000.00 that happened i think it started out december at like 85 percent and that it was like surge so hard into this into the end of december that it hit 100 percent so here's a tweet from carl can tell a fed's balance sheet continues epic rise up by an average of $101500000000.00 per month since september compared to $80000000000.00 per month during q e 3 quote it's hard not to imagine this influence on stock prices as long as

interest rates are near 0 it doesn't matter could be 2030 trillion dollars on the balance sheet here's a thought experiment and a bit of a prediction for 2020 going back to saudi aramco around co as it went public just recently at a market valuation an excess of $1.00 trillion dollars i think a one point was or 2 trillion dollars i think that we're going to see them make a hostile buy of a company maybe facebook for example and it could be the 1st trillion dollar hostile raid in history because they've got the balance sheet now if you've got a 2 trillion dollars balance sheet that means you've got you know the ability to borrow another trillion so you've got a 3 trillion dollar war chest if you go after an apple or even a berkshire hathaway 5 or $600000000000.00 so i went inside go buy berkshire hathaway just as a hostile rate and then they own a huge portion of the whole global market the american market why not they've got the balance sheet now they want to diversify away from oil and gas and i think we're going to see a move like that the next 6 to 9 months well i do believe that we could see

a doubling like we did in the end of the parabolic move because member alan greenspan had warned that the markets were displaying irrational exuberance he said that in 97 we continue on for 2 more years 1909 as i went. 85 percent we only went up 40 percent and 21000 if this is exuberance and you know the retail investor wasn't really participating in 29 everybody hated it everybody was like dissing even big names like carl icahn everybody was out so this could be the year that is and that ties to this final headline nobel laureate economist praises truong for stock market rally he creates animal spirits nobel laureate for economics robert shiller sees president donald trump as the primary cause of wall street's recent strength because he stoking the market's animal spirits schiller a woman nobel prize in 2013 chillers newly found praise for trump is a huge turnaround from the point of view he held back in january of 2018 when he

said in an interview he would give trump a grade of one or 2 out of 10 when it comes to economic policy he said he didn't vote for trump in 2016 but he thinks he'll win in 2020 right schiller agrees with me and i've said for 3 years now that a trump instills confidence in people the american economy is 70 percent consumer and you have that's a key component of barack obama never get no one gave anyone any confidence to do anything everyone looked at barack obama and his presidency and his policies and they were like i think i'll wait for somebody like a truck ok i'm going to take a break and when we come back much more coming your way. of the but if she warned you probably didn't i do the dishes at the baltimore did

you use new speech to see me we did you. know michael when you hear something. in the news i mean that so that you put your ball. a lot of you will see sawing during fuzzy fights about to cut out the most ardent the most called health insurance and she simple as a little history as a fire truck. a very. biased. ear chickie for dot com but i feel they've doing. a english lady a for people who simply who saw and knew she would include in it will. join me every thursday on the all excitement show and i'll be speaking to guest of the world of politics sports business i'm show business i'll see that.

time after time corporations repeat the same mantra sustainability it's very important it's accelerating the transition to sustainable prize board sustainability stay number man a more equitable and sustainable well. they claim their production is completely hamas does need to. look. into. it into something companies want us to feel good about buying their products while the damage is being done far away and this is something all this must be done to anyone and i mean look. this is the mills and you missed me doing the nieminen einstein theme that may be best understood so when. it is physics physics is nothing but the harmony you can create on vibrating

strings that is chemistry chemistry is the melodies the melanie's you can play on strings what is the universe the universe is is a symphony of strings. welcome back to the kaiser report time out of turn to an author of planet ponzi dot com mitch welcome back great to be here for bass in england so miss let's get into this you know the markets are defying all who were looking for a pullback these last 2 or 3 years we seem to be heading to 30000 on the dow what's

going on. i'll tell you max i'm pretty i'm pretty surprised actually you know we called it wrong this year i'm 1st to admit it you know the nasdaq is up close to 40 percent its year what we have an all time highs for the decade we've got stocks bonds property credit markets debt markets corporate debt stock buybacks c.e.o. lows valuations we are all time highs on central bank johnny elation and i think if that's the story we also have the new lows which are interest rates at historic 600 year lows trust in our government trust in big tech space both twitter google politicians media the government the f.b.i. n.s.a. congress all new lows so the next decade going to be a ripper we're going to see the next decade massive amounts of opportunity that will make the 40 percent gain nasdaq look small i think we're talking about a big correction that we'll see in the distortions that the central banks that put

forward for the last 10 years during the next 10 years 2020 is going to be a real economy of the next decade and a turnaround for where markets are going going on central bank magic in the i guess you'd have to make the comparison to 1999 i. was very involved in the dot com era at that time you were managing money you observed it 1st hand it is it similar to 1999 yeah the nasdaq was up 80 something percent that air alan greenspan had in 1906 and warned of irrational exuberance and then went on to catapult higher yeah the i.p.o.'s that were being launched at a 50 to 60 percent 1st day pop if you remember that was the big thing i remember when i was at the hollywood stock exchange we were about to go public

a barrister and barbara streisand was calling me asking to get stock in the i.p.o. you know things are crazy is it similar to 99 which i mean it's similar to 1999 only 19991929 max i think the valuations are in the stratosphere. on the metric that you know university you. never get i are of all time historic highs only have didn't have in 1990 are so many $1000000000.00 zombie. and. dollar unicorns and dollar. amount of the files it. like amazon. and apple are the valuations that are a little bit ridiculous right now but they keep or not they will not mean it is for the sad fact that. the european central bank.

has been buying. and is buying then hand over fist the swiss national bank. it's just a matter of time before the fed starts buying equity. i think that it will see more clearly i think they have no other chance but to do fury the markets they've proven. markets. at the end of the stratosphere the problem is we're doesn't know what it. is it's a problem as i've said for a couple hours it's impossible to hit the top of a bubble and you can tell we're going to probably have. $13000000000.00 and then we are yet to make a profit. you have a. seat at an all time high making the valuation.

i think there's a lot of company in the world. that's not over the outs. and is finding out with their move. or the big technology in those battles. and frankly it needs rare earth metals so those metals not come from china i doubt china is going to be very helpful in for moti american companies over their own movies. or so everybody is getting into the game with the east now so. i think we will come forward. in school. in russia. and i am. for to signal to the maps that the best are within the test drive my test which is not in the best way out there on the market in this case it was the millennial so far on their robin-hood stock app that were right they've been buying

tesla for the last 3 or 4 years and the stock just man a new all time high that professionals were shorting it and now there's a shared shorts quasar mascot kind of a thought exercise there because in an era now where the rumor is that black rock and blackstone are going to merge to create a multi-trillion dollar financial buy a myth and have got a ramp go saudi aramco went public a stab got in a $1.00 trillion dollars valuation my as my thought exercise is it possible that around cow could do a hostile raid of a company like a facebook and at a trillion dollar take out well we say potentially the 1st trillion dollar deal as a hostile deal that is that a possibility you know if they want to diversify why not met each well i think. trade as you saw stock drop this in the i.p.o. i was very skeptical about the valuation when i as i was very skeptical about

newark's valuation at 57. 7000000000 and i think i said it time last january's that work was a ponzi scheme we were turned out of the funds those guys are in and out well i don't know why it's a soft and asian fund going back to. i don't think that's an apple that i think we'll see another oil company. him out with such a while valuation and it. down to about $100000000000.00. after or something and i think i think ridiculous especially with the lack of transparency in the ramp those financial. i think. all the. negative. versus trillion dollars in negative debt now. you know

could never guarantee what i think. is the body when it was negative your bonds would definitely hold it the maturity it is money now we're going to change what are these constants in the pension fund is we should not allowed to buy an instrument a lot will last for the answer and this is just exploitation and it's it's one from saver for savers to the back we're going to fund many of its own and you know this is it will come full circle the next ok small it's going to blow up and it's not the end well i think what's happened is this isn't the version we've. added his around the world to some of the civil unrest that's on. you know on on the all over the world which seems civil unless we sense that the reduced wealth in the

central bank actions reciprocated by lowering interest rates and hundreds of trillions of dollars into part of its credit is itself that's sure about they losing money on a negative trade where you're going to end up with a positive carry because you especially have own all the central banks and the central banks are private corporations are not government to situations you know they can see how people would be abusing that market now mick you are right however about the fact that you can taper a ponzi scheme as the fed tried it and then the fed lost trying to do it after cutting its balance sheet by 8 percent for the 1st 3 quarters the fed ended up in the air up 2 percent on the on the balance sheet meaning the fed is that when the money printing spray not that the rest are all that ever stop printing money but the fed actually put some lip service to tapering upon say for a few months they failed they went right back in a money printing so i would assume your thought there is that that's only going to continue i think what we've got to look at is why are interest rates and the

millennial generation are trading now. all the nations that are trading that they don't understand the function of interest rates. and. where tripoli which we. are totally distorted in every possible ask. if. jack. now the problem it's not hundreds of dollars in negative. it's that's. not that great debt it's the. reason why interest rates around the world are its lows go up. how will still be able to service it so that interest will be hungry to find

a new tool to suki the phone once you know. what yeah i get it i get that whole scenario which we've been talking about for 4 or 5 years and meanwhile the deals get keep getting bigger and bigger so if you have a half a trillion or one trillion dollar hostile raid that'll perpetuate this ponzi scheme and less like what he out there to be investing in and the scarcity value of equity goes up because all of it's becoming private equity. and i think we're just about out of time but misfires stein we're going to keep you over for a 2nd segment because we love to pick your brain and find out what your insights are thanks for being on the cars report. not to fall into the nexus and that's going to do it for this edition of cars a report with me max kaiser and stacey everett like to thank our guests much firesign a plan apology dot com which want to reach us on twitter it's kaiser report until next time by.

the way by the but if she warned you probably didn't i do. at the bottom or there's a. new speech you see me we need to you. know about that come up and when you yes. you need to i mean that is with an infantry ball. a lot of people say was it hard to to try to both. but as it is to be. that bad that. city. it was 38 but people who simply who saw knew. she would include in total.

what politicians do. they put themselves on the line they did accept the reject. so when you want to be president or injury. or somehow want to. have to try to be close this is what will befall 3 of them or 10 people that. i'm interested in always in the waters of all. this should know. time of the time called parisian to repeat the same mantra sustainability it's very important. transitions to sustainable prize board sustainability spain were meant to be more equitable and sustainable while. they claim their production is completely hama's hollow do so.

because. it does on the books on companies want us to feel good about buying their products while the damage is being done far away and this is something all this must be undone even and i mean look. this is the moves of news that we didn't even an einstein themed understood little superman and. so what we've got to do is identify the threats that we have it's crazy to confront a shouldn't let it be an arms race is often spearing dramatic development only personally i'm going to resist i don't see how that strategy will be successful very critical of god i'm time to sit down and talk. food descriptions sound up a tasing even for the owners so how to choose just pet food industry is telling us

what to feed our pets really more based on what they want to sell us than was necessarily good for the pet turns out may not be as healthy as people believe and we have animals that have you know diabetes in arthritis they have auto immune disorders the cat allergies we are actually creating these problems it's a huge epidemic of problems all of them i believe can be linked to a very simple problem of diet and some dog owners so heartbreaking stories about their purchase less treats the larger corporations are not very interested in proving or disproving the value of their food because they're already making a $1000000000.00 on it and there's no reason to do that research. is. not.

the headlines this hour around classifies the u.s. armed forces as a terrible denies ation in response the pentagon is killing a top commander that a huge crowds of mourners gathered for the funeral of custom solomonic. the u.s. house speaker nancy pelosi announces a resolution to curb donald trump's ability to attack iran however has similar restriction was stripped from the defense bill passed by congress just last month on the russian president vladimir putin holds talks with his syrian counterpart assad in damascus amid the rising tensions in the middle east. as we enter 2020 the high note of political correctness still haunts us notably over the latest gangster film the gentleman he put up for the bat.